Work Comp Insights - Medical Marijuana and Work Comp

CoyleKiley Insurance Agency, Inc.
Your Workers’ Compensation Partner
Medical Marijuana and Workers’ Compensation
In the November 2016 elections, the use of medical
marijuana was approved through four state ballot
measures, bringing the total to 28 states and the District
of Columbia that have legalized medical marijuana in
some form. Additionally, the District of Columbia and
eight states—Alaska, California, Colorado, Maine,
Massachusetts, Nevada, Oregon and Washington—
have legalized recreational use
of marijuana in some form.
However, under the Controlled
Substance Act of 1970,
marijuana is classified as a
Schedule I substance with no
accepted medical use and a high
potential for abuse, making it
illegal at the federal level. Amid
state and federal law
contradictions, many workers’
compensation payers are
choosing to deny coverage for medical marijuana. Since
medical marijuana isn’t currently included in workers’
compensation treatment guidelines, they have every
right to do so.
As such, the future of medical marijuana in workers'
compensation remains unclear, and state and federal
lawmakers have their own opinions.
States’ Stances
Since marijuana is still a Schedule
I substance, it is illegal under
federal law, and many workers’
compensation payers are opting to
deny coverage.
New Mexico
New Mexico became the first state to propose a
reimbursement rule for medical marijuana in November
2015. The state’s 2016 fee schedule set the maximum
reimbursement rate for medical marijuana at $12.02 per
gram for injured workers. Under the state’s Lynn and
Erin Compassionate Use Act, authorization was
considered equivalent to a
prescription—requiring
employers to reimburse injured
workers for medical marijuana.
Furthermore, this process
allowed insurance carriers to
avoid directly paying for a
Schedule I substance.
Minnesota
In 2015, Minnesota’s health
commissioner decided to include
“intractable” pain as a condition
that could be treated with medical marijuana. According
to the Minnesota Department of Health, intractable pain
is defined as, “pain whose cause cannot be removed
and, according to generally accepted medical practice,
the full range of pain management modalities
appropriate for this patient has been used without
adequate result or with intolerable side effects.” This
decision has opened the door for claimants to request
that their workers’ compensation insurers cover the cost
for medical marijuana.
While states have different views on the use of medical
marijuana, there are various state rulings that may be
setting a new precedent in the workers’ compensation
and medical marijuana debate.
Maine
The outcome in a workers’ compensation case involving
medical marijuana was different than those in New
Mexico and Minnesota, when an employee who
sustained a back injury while making deliveries
requested reimbursement for medical marijuana.
According to Maine’s Workers’ Compensation Act of

1992 (MWCA), “an injured worker is entitled to
reasonable and proper medical, surgical, and hospital
services, nursing, medicines, and mechanical and
surgical aids, as needed, paid for by the employer.”
However, the employer argued that medical marijuanarelated
services should not be covered under the
MWCA, and that by covering such services, the
employer would be in violation of federal law and subject
to the risks of prosecution. In support of its argument,
the employer also cited Maine’s medical marijuana
statute, which states that it may not be construed to
require a government medical assistance program or
private health insurer to reimburse an individual for costs
associated with the medical use of marijuana. The
employer won the case.
Other states, including Arizona and Montana, are in
agreement with Maine and have taken the position that a
workers’ compensation insurance carrier cannot be
compelled to pay for medical marijuana because the
possession and use of marijuana is still illegal under
federal law.
Federal Opinion
Workers’ compensation payers rely on evidence-based
guidelines when making treatment decisions. Since
medical marijuana is considered a Schedule I substance
and is not included any workers’ compensation
treatment guidelines, many payers are opting to deny
coverage.
Benefits of Covering Medical Marijuana
There is significant interest in using medical marijuana
as an alternative to opiates for the management of
chronic pain. Furthermore, alternative treatments may
pave the way for medical marijuana, as meditation,
exercise, mindfulness, yoga and cognitive behavioral
therapy have proven successful in eliminating opioid
use. However, insurers have historically been more likely
to pay for opioids than alternative treatments.
Drawbacks of Covering Medical Marijuana
In states that have legalized medical or recreational
marijuana, workplace safety is a concern. It is the
employer’s responsibility to foster an environment devoid
of harmful hazards. If a company employs a medical
marijuana user, this person might experience side
effects that could lead to a workplace injury.
Furthermore, drug-free workplace policies could be
affected since marijuana continues to be categorized as
a Schedule I substance. For example, although an
employee may be authorized to use medical marijuana,
he or she could still be terminated if found positive for
marijuana in a random drug test.
Federal Outlook
It’s too early to anticipate President Donald Trump’s
official policies with regards to medical marijuana.
However, on the campaign trail, he said he was in favor
of rescheduling marijuana as a Schedule II substance,
which is in contrast to the Obama administration’s
stance. In 2016, former President Barack Obama
claimed that more research was needed into the drug’s
possible medical benefits.
New legislation and court decisions are continuing to
develop, which will affect workers' compensation
treatment decisions. For example, on Aug. 29, 2013, the
Department of Justice published a memorandum
authored by former Deputy Attorney General James
Cole, outlining a new set of priorities for federal
prosecutors operating in states which had legalized the
use of marijuana. The "Cole memo" encouraged law
enforcement agencies to focus on the most critical
federal priorities, such as preventing the distribution of
marijuana to minors. By doing so, the federal
government is taking a more hands-off approach in
jurisdictions that have enacted laws legalizing marijuana.
Also protecting the marijuana industry is the
Rohrabacher-Farr amendment, which prohibits the
federal government from spending money to target
medical marijuana businesses. However, the federal
government could still go after small businesses that
don't have the resources to fight. And if this amendment
isn’t renewed by Congress annually, the protection will
disappear, and the industry could be set back for years.
Until the discrepancy between state and federal law is
resolved—particularly in regard to drug-free workplace
policies—CoyleKiley Insurance Agency, Inc. will
continue to monitor the landscape for new developments
that could have ongoing ramifications for the industry
and could forecast marijuana reclassification.
This Work Comp Insights is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact
legal counsel or an insurance professional for appropriate advice. © 2017 Zywave, Inc. All rights reserved.